Skip to comments.Fannie Mae taps $7.8 billion from Treasury, loss widens
Posted on 11/08/2011 4:55:47 PM PST by Sub-Driver
Fannie Mae taps $7.8 billion from Treasury, loss widens Photo 6:42pm EST
WASHINGTON (Reuters) - Fannie Mae, the biggest source of money for U.S. home loans, on Tuesday said it needed a further $7.8 billion in federal aid to stay afloat as a shaky housing market widened its third-quarter loss to $5.1 billion.
Fannie Mae also attributed the deeper cash drain to losses on derivatives that are used to hedge the firm's exposure to swings in interest rates and expenses related to home loans made prior to the 2008 financial collapse. In the year-earlier quarter it had a loss of a $1.3 billion.
Fannie Mae, seized by the government in 2008, has drawn $112.6 billion in bailout funds from the Treasury Department since 2008 and has paid $17.2 billion to the government in the form of dividends.
"Fannie Mae is working to reduce losses on our legacy book and limit taxpayer exposure," Susan McFarland, the company's executive vice president and chief financial officer, said in a statement.
The government-owned company and its smaller rival Freddie Mac were taken over in the financial crisis as losses on subprime mortgages threatened insolvency. Given the crucial role the two play in U.S. housing finance, owning or guaranteeing about half of all mortgages, the government has pledged unlimited funds to keep the firms afloat through the end of 2012.
(Excerpt) Read more at reuters.com ...
I take Whiskey Tango Foxtrot and raise you a Facepalm. :O)
Put FM and FM down, NOW!
The CEO resigned last week too. But only after receiving millions in bonuses.
Let it fail, it’s better in the long run.
No, that was the CEO of Freddie Mac, not Fannie Mae.
I suggest you and I get a turn at being CEO of Fannie Mae. Whiskey Tango Foxtrot. I'll even let you go first.
As the CEO’s get millions in bonuses.
Yep. That makes total sense!
i’m reading “reckless endangerment” just now.
these people and some in the u.s. congress need to be in jail.
Let Barney and Chris ante up. They brought all this on (with a little help from their friends).
those damn pwedatowy wenders!
How would a Fortune 500 Company be treated by the gubmit if they claimed their losses were un-calculable?
How is this possible? Barney Frank said there were no problems with Fannie.
Video: Comparing Fannie/Freddie to Enron/Worldcom/Tyco
Bernard Ebbers, Worldcom: 25 years in prison
Ken Lay, Enron: Convicted on 10 counts, died before serving sentence
Jeff Skilling, Enron: 24 years in prison
Andrew Fastow, Enron: 10 years in prison
Dennis Koslowski, Tyco: 8 years in prison
Mark Schwartz, Tyco: 8 years in prison
So how about the officers of Fannie Mae, who conducted similar kinds of fraud in their financial statements in order to pad bonuses and keep regulators from discovering their precarious position until it was too late? Franklin Raines never faced criminal charges, and instead settled a civil suit with a $2 million payoff which came from Fannie Maes insurance company. Jim Johnson didnt even have to do that much.
And where are they now? The Washington Post reported twice that Raines was advising the Barack Obama campaign, although they denied it. Jim Johnson still advises the Obama campaign and had briefly led the search for a running mate. Supposedly the FBI has begun a criminal probe into the actions of Fannie Mae management over the years, but well see if that proceeds.
That’s another $7.8 billion that has not been appropriated by our legislature. They might as well go ahead and dissolve Congress. The fiscal year expired over a month ago, yet our government continues to operate without any monetary authorization from Congress. Our Republic is dead.
Shut it down...propping up the housing market *delays* the recovery (because real re-investment won’t return to the housing market until after housing prices bottom).
Now comes the “we have to do this or the system collapses”. Thats followed by libs saying lets cut principal on mortgages which guarantees more losses. It’s a lovely system they have for themselves.
FBI can get a Raines but much of what they did will be covered by the fact they were following policy set by congress. We know those people are invincible. They only make mistakes after all.
If you or i had done what some of these people did we’d be facing life sentences.
A $5.1 Billion loss needs a $7.8 Billion amount to cover the losses???
Where is the rest of the money going? Into Barry the Imposter’s bank accounts???